I have been kicking around the idea of buying a beach house around Galveston or Freeport but was curious about insurance requirements. I assume you need homeowners insurance along with wind insurance but is there anything else?

Is flood insurance a requirement, or is this negated because of homes being on stilts? Is there a minimum height that homes have to be? Newer homes seem to be much higher than some of the older ones. Does this have anything to do with insurance requirements?

TIA

A beach house will require the following insurance if it's in a flood zone. If you pay for the house with cash and don't have a loan you are not required to buy any insurance. If you have a loan your bank will require. Flood even if on stilts, I've been down this road several times. Flood insurance is expensive now a days

1. Regular home owners insurance for fire, theft, accidents, etc.
2. Flood insurance (rising water)
3. Wind insurance (Texas Windstorm Insurance)

If you arent paying cash for the house, insurance premiums are going to kill you. Especially wind and storm.

Our coast house has the three separate policies mentioned. Our coast house is about 60% of the value of our primary home and costs about the same to insure.

That said, here is my current view. Pretty tough to beat

Rockport homeowner, about 3 miles from the water, as stated plan on homeowners, of course. Our Flood and TWIA (Wind storm) run an additional $5,000 per year. More if your home is valued more than ours.

My parents owned a beachfront house on the west end of Galveston. They didn't have a mortgage and their house was high enough that flood insurance was reasonable. I think the house had to be 19' above ground level for flood insurance to be cheaper.

It cost them about $20k per year in taxes and $30k per year for insurance. I think replacement cost on their house was like $700k

Our beach house is valued at about $850,000. Oddly it's not in a flood zone but it is about 30 yards from the marsh and 200 from the beach. It was built in 1950 and has a finished basement which has flooded once that I know of. We do not have flood insurance and our insurance bill is about $2000/ year. My sisters house is about a mile south and her house is valued about the same but IS in a flood zone so she has flood insurance. Her bill is about 4 times ours. Her house is in Massachusetts, mine is in New Hampshire so it might be irrelevant for this thread but I just like talking about my beach house.

Very interested in this, last year we purchased a canal lot on Bolivar and will be building in the next couple of years. Considering paying cash and "self insuring", I guess I just need to put pen to paper and figure out the best deal.

swampstander said:

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Our beach house is valued at about $850,000. Oddly it's not in a flood zone but it is about 30 yards from the marsh and 200 from the beach. It was built in 1950 and has a finished basement which has flooded once that I know of. We do not have flood insurance and our insurance bill is about $2000/ year. My sisters house is about a mile south and her house is valued about the same but IS in a flood zone so she has flood insurance. Her bill is about 4 times ours. Her house is in Massachusetts, mine is in New Hampshire so it might be irrelevant for this thread but I just like talking about my beach house.

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You can still buy flood insurance. Might not be a bad idea, and I think is cheaper if you are out of the flood zone

Zone X is about half the proce of Zone AE on flood insurance. At least for me it is. But it is pretty reasonable still - inthink my flood policy is about $750 or so a year.

Wind and Storm is what breaks it off in me, it is significantly more expensive than both flood and homeowner's combined.

We own some properties on the coast, a condo in Port A, a house in Pelican Cove and a lot where we are building our forever home. If you buy a house and it has flood insurance you can assume that policy and pay a $250 premium (if it is not a primary home) but that policy will be much cheaper than a new one, roughly by about $1000/yr in savings by assuming the previous policy. Your flood policy will max out at $250k for the building and $100k for contents so if you feel like a flood event will cause more damage than that you will need to buy supplemental insurance to cover the difference. I would not own a house on the coast without flood and TWIA coverage, we paid cash for out Pelican Cove house so no insurance was required, but that was never a thought. Between TWIA and flood, TWIA is more important to have, in the case of a hurricane the argument will most always be that your house flooded not because of rising water but from wind driven rain and roof damage. When looking at TWIA coverage you need to consider what future rebuild costs will be and insure to that level or to whatever you think you need to be able to cover the difference out of pocket.

The house we paid cash for came back with a rebuild cost that was about 35-40% higher than what was insured by the previous owners if the house had to be taken down to the slab and rebuilt. The odds of that happening are low, but they are definitely not zero so we insured to the rebuild cost because it would take nearly my expected lifetime to match the difference in insurance costs vs out of pocket cost if that were to happen.

Owning/living at the coast is great, but it does come with a lot of added costs that other homes do not.

The "need" for insurance is dependent upon your risk tolerance and if you have a mortgage.

You'll want to find out what FEMA flood zone the home is in. If it's a zone prefixed by A or V, the base flood elevation becomes important. Getting flood insurance may require demonstrating the elevation of the lowest habitable floor relative to the base flood elevation. Also, if it's in an A or V zone, expect higher premiums all around.

Is there a rule for the height of the first livable floor and flood elevation? Is the first floor is 20 feet up, does that negate the requirement for flood insurance?

If I did purchase, it would very likely be with a sizable down payment but still mortgaged.

https://www.fema.gov/hmgp-appeal-categories/coastal-barrier-resources-system

Check this also, One zone starts just north of sargent and works east along the coast. I am unaware of how far east it goes. It may have some impact on insurance type availability and cost.

The BFE varies by location. Maybe start here: https://msc.fema.gov/portal/home

or here: This is a GIS site for the FEMA FIRMs. Find the house, then click on the FIRM label and download a graphic map. The flood zones and BFEs will we on the map.

As I understand it, yes, some lenders may waive the requirement for flood insurance if the structure is elevated above the BFE. It's possible that others may still require it. I'd specifically ask. NFIP rates for elevated structures should be significantly lower, but you may need an elevation certificate to be underwritten. I don't know the specifics, sorry.

There are processes for removing a specific property from a flood zone - typically due to elevation.

The BFE is just a statistical flood elevation (100 year flood, 1% chance of exceedance in a given year), it doesn't guarantee or predict anything.

Not just NFIP flood insurance. No federal backed mortgages for homes in CBRA zones either. And, if you're hoping for federal dollars for a beach renourishment, etc. it's not happening.

Then you'll discover most of your damage was caused by something the crooked insurance companies call "wind driven rain" and neither windstorm or flood cover it. What a load of crock.

AnScAggie said:

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We own some properties on the coast, a condo in Port A, a house in Pelican Cove and a lot where we are building our forever home. If you buy a house and it has flood insurance you can assume that policy and pay a $250 premium (if it is not a primary home) but that policy will be much cheaper than a new one, roughly by about $1000/yr in savings by assuming the previous policy. Your flood policy will max out at $250k for the building and $100k for contents so if you feel like a flood event will cause more damage than that you will need to buy supplemental insurance to cover the difference. I would not own a house on the coast without flood and TWIA coverage, we paid cash for out Pelican Cove house so no insurance was required, but that was never a thought. Between TWIA and flood, TWIA is more important to have, in the case of a hurricane the argument will most always be that your house flooded not because of rising water but from wind driven rain and roof damage. When looking at TWIA coverage you need to consider what future rebuild costs will be and insure to that level or to whatever you think you need to be able to cover the difference out of pocket.

The house we paid cash for came back with a rebuild cost that was about 35-40% higher than what was insured by the previous owners if the house had to be taken down to the slab and rebuilt. The odds of that happening are low, but they are definitely not zero so we insured to the rebuild cost because it would take nearly my expected lifetime to match the difference in insurance costs vs out of pocket cost if that were to happen.

Owning/living at the coast is great, but it does come with a lot of added costs that other homes do not.

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Pelican Cove in AP ?

Sounds like a giant pain in the arse and a money pit. Maybe I'll just look into renting a boat slip until I can win the lottery.

Anyone have any suggestions for a boat slip around Galveston or Freeport?

Wind-driven rain is covered on a residential homeowners TWIA policy by endorsement. It must be added but it's extremely important.

It is a federal law that lenders must require flood insurance for loans in flood zones, regardless of the structure elevation.

There are exemptions to everything including forced flood insurance. Just one reason to pursue a LOMR to have the flood map revised.